Friday 9 December 2016

NTMA may now issue 30-year bonds to fund State

Andras Gergely

Published 03/03/2010 | 05:00

Ireland may borrow more than the €20bn it needs for this year in order to have some cash ready for 2011 when a larger amount of existing loans have to be replaced, the head of the national debt management agency said yesterday.

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John Corrigan, chief executive officer of the National Treasury Management Agency (NTMA), said that it may also consider raising 30-year loans through the sale of government bonds.

"A 30-year issue is something we are told there is a lot of appetite for," Mr Corrigan said in an interview -- although no sale is imminent.

Any issue of a 30-year bond -- something the NTMA has not done before -- would be done with a syndicate of banks, on top of the remaining scheduled monthly auctions running until November.

Ireland only has about €1bn in bonds maturing this year, but the NTMA has to borrow some €19bn to cover the planned budget deficit.

Mr Corrigan said he would like to raise some funding for up to €6bn in bonds due for repayment next year.

Opportunity

"If the opportunity arises to do more than the €20bn on good terms, we may issue a little bit more to carry something into next year," he said.

The NTMA has already raised almost half of the €20bn in the first two of its monthly bond auctions and one syndicated sale.

The agency may also have to borrow some money to recapitalise the banks, although much will come from converting government shares and the national pension fund.

It will also be responsible for over €50bn in bonds which will be issued to the banks in return for property loans, with a total book value of €80bn transferred to the National Asset Management Agency (NAMA). (Reuters)

Irish Independent

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